Hong Kong and China shares decline, financials weaker

(Updates to midday)

* HSI down 1 pct, Shanghai Comp down 0.1 pct

* Shanghai midday turnover highest since Nov. 3

* HSBC, AIA top drags in HK ahead of earnings

* Gold stocks strong on high gold prices

By Clement Tan

HONG KONG, Feb 23 (Reuters) - Hong Kong and China shares declined on Thursday, dragged by weakness in financial stocks as investors took profits after its recent relative strength and ahead of some key earnings in the next few days.

The Shanghai Composite Index hit a near three-month intraday high before closing down 0.1 percent at 2,402.3 at midday. A-share turnover on the Shanghai bourse at midday was at its highest since Nov. 3.

Hong Kong's Hang Seng Index closed down 1 percent at 21,337.5 in sluggish turnover. The China Enterprises Index of the top mainland listings in Hong Kong slipped 1.1 percent.

AIA Group Ltd and HSBC Holdings Plc, scheduled to post 2011 earnings on Friday and Monday, respectively, were the top drags on the Hang Seng Index, down 1.8 and 2.7 percent.

"There seems to be some who are quite tentative about expected earnings, locking in some profits especially on companies that have done well lately," said Alan Lam, Julius Baer's Greater China equity analyst.

HSBC, Europe's largest bank, has slipped 2.3 percent since closing on Tuesday at its highest since early August. It is currently up 18.6 percent in 2012 to date, outpacing the 15.7 percent gain on the Hang Seng Index.

In contrast, AIA is currently up 11.3 percent in the year to date, underperforming the Hang Seng Index. Thursday's losses so far took it down from its highest close since Aug. 4 on Wednesday.

Eleven of 23 analysts have cut their estimates for AIA by an average of 22.6 percent since Jan. 26, while 7 of 17 analysts have raised their estimates for HSBC by an average of 1.6 percent since Feb. 2, according to Thomson Reuters StarMine.

In its preview of AIA's earnings, Barclays analysts expect the insurer to deliver a strong set of operational results, with stable growth in operating profit, despite a 40 percent decline in headline profits from the year before.

In Shanghai, Citic Securities, among the mainland's top brokerages, was its top drag, down 1 percent after closing on Wednesday at its highest since mid-November.

STRONG GOLD STOCKS LIMIT LOSSES

Limiting losses on the day was strength in gold stocks, tracking rising gold prices, that hit a three-month high on Wednesday. The Shanghai Materials Sub-index was a standout outperformer, up 0.5 percent.

Spot gold edged lower on Thursday, taking a breather after hitting a three-month high in the previous session, while sentiment remains supported on hopes of further monetary easing after sluggish economic data from the euro zone and China.

Zijin Mining Group , the mainland's biggest gold producer, rose 2.2 percent in Shanghai and 0.6 percent in Hong Kong.

Shares in Chinese cable TV company Jishi Media Co Ltd surged by 65 percent in its first morning of trade on Thursday, reflecting improved demand for new offerings amid the recent stock market rebound. (Editing by Jacqueline Wong)